The stock market has been hitting the new highs lately and the company’s earnings has been solid, and the world’s most renowned investor is struggling!!!
Warren Buffett’s famed holding company Berkshire Hathaway said its second quarter profit fell by 15% – a surprisingly high drop that sent down its stock by 1% on Monday. If you are unable to gauge the statistic, keep in mind that a single ‘A’ share of Berkshire costs $267,080, even after the Monday’s decline.
The price of the Bekshire’s share- which is more of like the pricing of a Villa- stems from the Buffett’s decision of not splitting the original class of stock from the founding of the company.
There is also a newer share of stock ‘B’ whose price isn’t so high in nominal terms. The ‘B’ share also fell 1% on Monday, ending at $178.07 a share.
Berkshire’s investment returns were down for the quarter and showed an unexpected loss in its insurance business.
If anything, history suggests that lagging the broader market may ultimately prove to be a badge of honor for Buffett.
The “Oracle of Omaha” also famously sat out the 1990s tech bubble, declining to invest in tech stocks he said he didn’t understand. Berkshire’s performance suffered, and Buffett took criticism for being out of step with the times.
Some other details surrounding Berkshire’s latest profit announcement:
- Berkshire’s second-quarter profit totaled $4.3 billion, down from $5 billion in the year-ago period.
- Although the average consumer doesn’t interact much with Berkshire directly, it owns significant stakes in many household-name brands. Its holdings include Geico, Dairy Queen, Duracell, Benjamin Moore & Co., and Fruit of the Loom.